‘How do you run out of sand?’ Supply chain crisis squeezes Reno businesses, drives change – Reno Gazette-Journal

December 17, 2021 by No Comments

A worldwide logistics backlog is stretching Northern Nevada businesses thin this holiday season. It is also accelerating big changes in the industry as the delivery economy continues to surge.

Bob Walker leans over his computer screen, scanning backed-up orders for walk-in coolers, deep fryers and grills. 

Behind him, stacks of blueprints and rolled-up plans for milkshake bars, delis and cafes are piled high on a desk. All of them are for restaurants hoping to open soon in Reno. 

But before each business can open, Walker, a manager at RESCO Restaurant Equipment and Supply in Reno, must first find the refrigerators, sinks, stoves and other equipment they need.

There’s just one problem.

From computer chips and vehicle parts to toys and even chicken tenders, a global supply chain crisis is squeezing businesses just in time for the busy holiday season. Car manufacturers, national grocery chains, local auto mechanics, small mom-and-pop shops — none are immune to the impact of the logistics logjam affecting cities big and small across the country.

Due to those mounting supply chain hurdles, RESCO is just one of the local businesses having to piecemeal orders for equipment that may not come for months. By the time they arrive, the items have also typically gone through multiple price hikes.

“The business is good,” Walker said. “It’s just a lot of hard work right now.”

In his 40 years on the job, Walker never had to hunt so diligently for basic restaurant necessities. He also says that it’s the first time he’s seen the industry hit by such long product delays that often come with astronomical price increases.

“Let’s say I order a product, issue an order to the customer, and they pay, but our supplier realizes there are parts that are going to take extra time or work to get, and now they tell us now it’s this much,” said Walker. “How do you turn around and tell (your client) it’s going to be $12,000 more? Now I have to add a clause that says prices are predicated on time of shipment.”

It’s a crisis so massive that it’s also reshaping parts of the U.S. economy. 

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As COVID-19 accelerates the adoption of a hybrid remote workspace, the pandemic is also speeding up the adoption of mobility hubs and micro-fulfillment centers that focus on last-mile delivery as the logistics gridlock exposes long-standing issues in the system.

“The pandemic has taught us … how vulnerable this system is,” said Marilee Utter, who chairs global advisory group Counselors of Real Estate. “Imagine a dog on the freeway during rush hour. Even if the dog is there for just one minute… everything gets stopped.”

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Source: https://www.rgj.com/story/news/money/business/2021/12/16/supply-chain-businesses-reno-nevada/8842232002/


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